Larry Levato of Crabtree Rohrbaugh Associates explains the process of a district-wide feasibility study the firm will be conducting for Crestwood School District during Thursday’s monthly school board meeting.
                                 Mark Guydish | Times Leader

Larry Levato of Crabtree Rohrbaugh Associates explains the process of a district-wide feasibility study the firm will be conducting for Crestwood School District during Thursday’s monthly school board meeting.

Mark Guydish | Times Leader

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WRIGHT TWP. — Noting it was very early in the process and the district was trying to keep all options open in a tough budgeting year, the Crestwood School Board voted unanimously at Thursday’s monthly meeting to approve a preliminary budget that includes raising taxes above a state limit.

“Our goal is not to exceed the limit,” business manager Peter Bard said, adding the district made the move — which includes applying for two exceptions to the limit — in case a financial refinancing move doesn’t work.

The state sets an annual Act 1 Index for each school district each year capping any property tax increase. A district can only exceed the limit by either getting voter approval through a referendum in the primary election or by getting approval for a narrow list of exceptions from the state.

Crestwood’s limit this year is 3.2%. The preliminary budget calls for an increase of 4.81%. The district will apply for exceptions to cover rapidly rising costs for for the teacher retirement fund and health care.

Bard said internal calculations show the district should be granted the exceptions, but even with them the district would be short $1.65 million in the 2020-21 budget. The district plans to refinance a $2.4 million debt service payment due next year, reducing it to about $600,000 and deferring payment for the next two years.

The move would mean a balloon debt payment the third year, but Bard said the district expects to get finances in better order to handle that.

Most districts would rely on a fund balance to cover a budget shortfall, but Crestwood’s fund balance was down to $140,567 this fiscal year (beginning July 1) and has evaporated since then because of the need to hire some teachers, Bard said.

By law the district has until June 30 to approve a final budget, and officials are hopeful they will find more savings and revenue to reduce the tax hike in the initial budget.

The meeting started with Larry Levato of Crabtree Rohrbaugh Associates explaining the upcoming feasibility study process. The district hired Crabtree last year to conduct a district-wide study of buildings, budget and education needs and make recommendations that could range from doing nothing to renovations to new construction that would involve the elementary grades.

Levato touted the firm.s 35 years experience, low cost-per-square-foot history, success in getting grants for energy efficiency, and guarantee to stay within the budget set with the district.

Reach Mark Guydish at 570-991-6112 or on Twitter @TLMarkGuydish